UC Definition of Equipment
Effective July 1, 2004, the university raised the equipment capitalization level to $5,000 from $1,500. The University of California now uses a minimum dollar threshold of $5,000 in its definition of equipment for purposes of capitalization, inventory, and indirect cost application and calculation. Equipment is defined as articles of nonexpendable tangible personal property having a useful life of more than one year, and an acquisition cost of $5,000 or more per unit.
To moderate the effect of this change on contracts and grants, there was a two-year phase-in period. Equipment costing $1,500 or more projected to be received before July 1, 2006 should have been included as equipment in proposal budgets. Items fitting the equipment definition costing $5,000 or more projected to be received on or after July 1, 2006 should be included as equipment; items costing less than $5,000 projected to be received on or after July 1, 2006 should be included as supplies.
UC Berkeley Campus Policies and Procedures Update
UC Office of the President Policy and Guidance
- Implementation Plan - Changing the University’s Definition of Equipment (4/7/2004)
- Questions and Answers (6/3/2004)